The port deal ended badly for everyone

Published: March 20, 2006 12:00AM

The Kentucky Post

Theres no getting around it. The Dubai deal ended badly.

The administration can be faulted for mishandling it. President Bushs aides never informed him that allowing an Arab firm to manage marine terminals at six U.S. ports was politically explosive, and Bush was blindsided as a result.

The debate was never about port security, really. That will remain in the hands of the Coast Guard, Customs and port police. And it was never about American jobs that would have remained unchanged except for the name on the paycheck. The same company, DP World, will be shipping containers to the United States from the worldwide ports it manages. It just wont be unloading them here. In the face of Congress noisy political opposition, DP World agreed to transfer those functions to a U.S. entity.

What are other nations to conclude from the U.S. thumbs-down on a deal backed by the United Arab Emirates, probably our closest ally in the Persian Gulf? Probably that the United States is hostile to Arab investment and even to Arabs themselves. And maybe that all that U.S. talk about free trade and investment is hypocrisy.

Face it: As long as we keep running budget and trade deficits, we really need outside investment.

As for Bush, the rebuff by his own party shows that his clout in Congress has badly diminished over the past year. That played out not only in the Dubai deal, but in congressional Republicans discarding most of the presidents budget initiatives.

It will take more than happy talk from Karen Hughes, the presidents public-relations emissary to the Arab world, to put a smiley face on this one.

Maybe it was just coincidence, but on March 10 the office of U.S. Trade Representative Rob Portman, the former congressman from Cincinnati, announced that free trade talks with the United Arab Emirates had been postponed.